PM.ppt

7/18/2019 PM.ppt

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P C Tripathi & P N Reddy

7/18/2019 PM.ppt


CoursecontainsPart - 1

Management

Planning & control

Co-ordination And Delegation

Decision making – Centralization – Decentralization

Programmed ealuation and reie! techni"ue #P$RT%

Management y '(ecties #M)'%

Motiation TheoryPulic Relation

Con*ict Management

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CoursecontainsPart – 2

+iscal Planning

,ero )ased udgetingMidterm appraisal)udget estimate- Reised estimatePerormance udget

AuditCost e.ectieness

Cost accounting

Critical Path!ays

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Management

De/nition

Management is an art o getting things donethrough people0

Management i our actors o production M$N

M'N$1

MAC23N$4

MAT$R3A54

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Management

De/nition

Management is P'4DC'R)

Planning

'rganizing 4ta6ng Directing Cooperating Reporting

)udgeting

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+unctions o Management

Planning

7hat is to e Done

7hen it is to e done

2o! it is to e done7ho is to do it

$80 Ta8es9 Political $nironment

Planning must e *e8ile

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'rganizing

An organization is social unit9

'r human grouping delierately structured9

+or the purpose o attaining speci/c goals0

'rganization is rational coordination o theactiities o numer o people9

+or achieement o some common purpose orgoal9

Through diision o laor and a hierarchy oauthority and responsiility0

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Directing

2armony '(ecties

:nity o command

Direct superision$6cient communication

+ollo! through

Motiation

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Controlling

$stalishing standards o perormance9

Measuring current perormance and

comparing it against the estalishedstandards9

Taking action to correct any perormance thatdoes not meet those standards

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3nnoating

Creating ne! ideas

3mproement o Product

Di.erent marketing strategies3nnoation in packaging9 Distriution9

)usiness models;0

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PlanningPlanning is an intellectual process !hich

re"uires a manager to think eore acting0

Planning is continuous process0

Plan must e *e8ile0Change direction to adept to changing situation Technology # changing need%

Market #Marketing 4trategies%+inance #'tain +und%Personnel #<o Rotation%'rganization #organizational structure %

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Planning

3mportance or AdantagesMinimize risk and uncertainty

5eads to success

+ocus attention on the organization=s goals+acilitates control

Trains e8ecuties

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Planning

Types

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Planning

Types4trategies

Competitie Adantage

47'T Analysis

'perational Plans

Policies

Procedures Methods

Rules

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Planning

Process$stalishing ariale goals or 4et o goals to

e Achieed

$stalishing planning Premises

3nternal and $8ternal Premises

Tangile and 3ntangile Premises

Controllale and non controllale Premises

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Planning

ProcessDeciding the planning Period

5ead time in Product Deelopment

Capital 3nestment & Payack Period

+inding Alternatie course o Action

$aluating & 4electing a course o action

Deeloping deriatie Plan

$stalishing Action Plan

Measuring and Controlling the Process

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Controlling

Need +or

Controlling

To Measure Progress

To :ncoer Deiation

ChangeComple8ity

Mistake

Delegation

To 3ndicate correctie action

T' transmit correctie action in the 'peration

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Controlling

)ene/ts

3ncrease Productiity

Reduce deects & Mistakes

2elp meet deadlines

+acilitates communication

3mproe saety

5o!ers cost9 7ork control

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Coordination

De/nitionCoordination is the management o

interdependence in the !ork situation0

3nterdependent e.orts o indiidual

To attain a common goal0

$80 2ospital9 Production company0

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Coordination

NeedDiision o laor

3nterdependence o unit

3ndiidual interest >s0 'rganization interest

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Coordination

Re"uirementDirect contract

$arly start

Continuity

+le8ile

Clear cut o(ecties

$.ectie communication

$.ectie leadership

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Delegation o Authority

MeaningA manger can?t do all the task or the

accomplishment o group goals9

2is capacity to do !ork and to take decisionsis limited9

Assigns some part o his !ork to hissuordinate and also gies them authority to

make decision in their duties9Do!n !ord pushing o authority to make

decisions is kno!n as Delegation o Authority0

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Delegation o Authority

De/nition

3 the manager re"uires his suordinate toperorm the !ork9 he must entrust him !ithpart o the rights and po!ers !hich heother!ise !ould hae to e8ercise himsel that!ork done0

5ouis A0Allen

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Adantages oDelegationReliees the manager rom heay !orkload

5eads to etter decisions

4peeds up decision – making

Train suordinate

Create ormal 'rganization structure

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)arriers to e.ectieDelegation+ear o loss o po!er

@? 3 can do it etter my sel?? +allacy

5ack o con/dence in suordinates

+ear o eing e8posed

Di6culty in rie/ng 'er con/dence

Not proper control

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Decentralization$ery organization has to decide as to ho!

much decision – making authority should ecentralized9 in hands o the chie e8ecutie

and ho! much should e distriuted amongthe managers at lo!er leels0

Centralization –

3n centralization set up9 the decision- makingauthority is contracted in a e! hands at thetop0 3n decentralization set up9 it is delegated tothe leels !here the !ork is to e perormed0

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Decentralization Criteria The Breater is the numer o decisions made

at lo!er leels0

The more important are the decisions madeat lo!er leel

The more is the numer o area in !hichdecisions can e made at lo!er leels

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Decision MakingDecision making is the Process o Decision

making that o(ecties and polices are laiddo!n and the manager decides many things

such as97hat to produce

7hat to sell

7here;9!hen;0092o!;;009

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Decision Making

Types

Programmed and Non programmed Decisions

Ma(or and minor Decisions

Routing and 4trategic Decisions

3ndiidual and Broup Decision

4imple and comple8 Decisions

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Decision Making Process

Recognizing the prolem

Deciding priorities among prolems

Diagnosing the Prolem

Deeloping alternatie solution or course oaction

Measuring and comparing the conse"uences

o alternatie solutionConerting the decision in to e.ectie action

+ollo! up

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Philosophies oadministrationCost e.ectieness

$8ecution and control o !ork plans

Delegation o responsiility

2uman relations and good morale

$.ectie communication

+le8iility in certain situation

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comparison et!een management

and administration Management Administration

#De/nition% Art ogetting things done

through others ydirecting their e.ortsto!ards achieement opre-determined goals0

#Nature% e8ecutingunction9 doing unction

#4cope% Decisions !ithinthe rame!ork set y theadministration0

+ormulation o roado(ecties9 plans &

policies0

decision-makingunction9 thinkingunction

Ma(or decisions o anenterprise as a !hole0

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and administration Management Administration

#Authority% Middle leelactiity

#4tatus% Broup omanagerial personnel!ho use their specializedkno!ledge to ul/ll the

o(ecties o anenterprise0

#:sage%:sed in usinessenterprises0

Top leel actiity

Consists o o!ners !hoinest capital in andreceie pro/ts rom anenterprise0

Popular !ith

goernment9 military9educational9 andreligious organizations0

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and administration management Administration

#3n*uence% Decisions arein*uenced y the alues9

opinions9 elies anddecisions o themanagers0

#Main +unction%

Motiating andcontrolling

Ailities%2andles theemployees0

3n*uenced y pulicopinion9 goernment

policies9 customs etc0

Planning and organizing

2andles the usinessaspects such as /nance0

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Principles o administration

2enri

+ayolaDiision o !ork

Principle o Authority and responsiility

Principle o DisciplinePrinciple o unity o command

:nity o direction

4uordination o indiidual interest to general

interest

Principle o centralization and decentralization

Principle o scalar chain

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Principles o administration

2enri

+ayolaPrinciple o 'rder

Principle o $"uity

4taility o tenure o personalPrinciple o initiatie

Principle o $sprit de corps

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Program ealuation and

reie! techni"ue #P$RT%P$RT9 a pro(ect is ie!ed as a total system

and consisting o setting up o a schedule odates or arious stages and e8ercise o

management control9 mainly through pro(ectstatus reports on this progress0

+inished Product or 4erice desired

Time & )udget

4tarting & Completion Date

4e"uence o step

$stimated time & Cost

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P$RT Process3dentiy the speci/c actiities and milestone

Determine the proper se"uence o theactiities

Construct a net!ork diagram

$stimate the time re"uire or each actiity

Determine the critical path

:pdate the P$RT chart as the pro(ect progress

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)ene/t o P$RT$8pected pro(ect completion time

Proaility o completion eore a speci/edtime

Critical path actiities that directly impact thecompletion time

Actiity star and end date

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5imitation o P$RTNumers may e only a guess

Actuality is di.erent

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Bantt charts

2enry 50

Bantt Bantt chart depicted a series o eent

essential to the completion o a pro(ect orprogram0

Controlling the production

:sed or production Actiities

Represent Cost9 time9 scope

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Process o The Bantt

ChartBather data

Analyze data

Deelop a plan3mplement the plan

$aluation9 eedack9 and modi/cation

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Adantages They can e understood y !ide audience0

They de/ne schedule actiities0

3t is useul and aluale or small pro(ects0

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Management y o(ecties

#M)'%M)' is the process !herey9

4uperiors & suordination (ointly identiy thecommon o(ecties9

4et the result that should e achieed ysuordinates9

Asses the contriution o each indiidual and

integrate indiiduals !ith the organization94o as to make est use o organizational

recourses0

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Management y o(ecties

#M)'% De/0

M)' is comprehensie managerial systemthat integrate many key managerial actiitiesin a systematic manner9 consciously directed

to!ards the e.ectie & e6cient achieemento organizational o(ecties0

Approach & Philosophy to management

A.ect eery management techni"ue

M)' is an o(ecties

'(ectie setting & Perormance reie!

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'(ecties o M)' To measure and (udgment

Relate indiidual perormance toorganizational goal

$8pectation & accomplishment

3ncrease competence & gro!th osuordinates

Communication et!een superior &suordinate

)asis o salary and Promotion

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Process o M)'4et corporate o(ecties

4et and Align employee o(ecties

Monitor perormance$aluate perormance

Re!ord employee

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M)'Advantages Disadvantages

)etter management oorganization

Clarity in organizationalaction

Personnel satisaction

'rganizational change

Time & Cost

+ailure o M)'philosophy

Prolems in o(ectiessetting

3n*e8iility

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MotiationMotiation is the action that stimulates andindiidual to take a course o action9

7hich !ill result in an attainment o goals9

'r satisaction o certain material orpsychological needs o the indiidual

<o perormance Aility Motiation

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Methods o motiation3ntrinsic 3nternal Motiation

4el motiation

<o satisaction

$8trinsic$8ternal motiation

Monitory re!ord

Promotion

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Types o Motiation

Achieement Motiation

A6liation Motiation

Competence MotiationPo!er Motiation

Attitude Motiation

3ncentie Motiation

+ear Motiation

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Motiation TheoriesAraham Maslo!

Alderer $RB Theory

2erzerg t!o actor need TheoryMc Bregor?s Theory E and Theory 1

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Araham Maslo!#FGHI%Araham Maslo! theory studies o di.erent

needs o human eings or motiation0

Physiological needs

4aety and security needs

4ocial need

$steem needs

Need or sel actualization

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Alderer $RB theory$- e8istencePhysiological need4aety need

Relatedness4ocial need Relationship & loe

The Bro!th4el esteem4el actualization

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2erzerg t!o actor theory

#FGJJ%3ts de/ne the satisaction and dissatisaction

o human eings to!ards !ork0

T!o actor are

Motiation actors K satisaction o !ork9achieement 9 'pportunity or gro!th9

Adancement

2ygiene actors K 4alary9 status9 !orkingcondition9 (o security0

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Daid McClelland#FGJF% This theory ased on three actorneed o

human eings0 They are di.erent at di.erentleel0

Need o Po!er

Need o A6liation

Need o Achieement

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Man Bregor?s Theory E &

1 Theory ” X” Theory “Y”

Do not like !ork

Aoid the !ork

Doing orce ully

Aoid responsiility

Need o <o security ishigh

L R3B2T T'C'MMAND

Physical and mentale.orts at !ork

4el control

4el directed

Committed to their goals

Creatiity o soling

ProlemsLPART3C3PAT3>$

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uery 4olution4lack Time K

4lack time is the di.erence et!een the lengtho time you hae to /nish a pro(ect and the total

amount o time it !ill take to complete thepro(ect0

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4el Actualization )y Tyler9 data that support this argument areproided y a study in !hich employees?!illingness to engage in citizenship ehaior

increased ollo!ing manipulations o group-ased pride and respect0 Results point to theproductie and sustainale potential o sel-actualization at a collectie rather than (ust a

personal leel

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Pulic RelationPulic relation are kno!ing !hat the pulice8pect and e8plaining ho! administration ismeeting these desires0

- <ohn Millet

Pulic relation are the process !here y anorganization analyses the needs and desires o

all interested parties in order to conduct it selmore responsiely to!ards them0

- Re8 2arlo!

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Pulic Relation $ssential and integrated component

Pulic policy or 4erice

)ene/ts or citizens )uild up image o indiidual or an

organization

Remoe misunderstandings

Create mutual understandings

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Need o Pulic Relation3ncreased goernment actiities

Reduce the communication Bap

3ncreased educational standards To kno! employee reie!

Pulic opinion in decision

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+unctions o Pulic

RelationRelation among the t!o group

:nderstanding and Bood!ill0

'rganization Policy

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$lement o Pulic

RelationPlanned e.ort or management unction

Relation et!een organization and pulic

$aluation o pulic attitudes and 'pinion'rganization=s decision related to

organization=s pulic

$8ecution o an action and communication

programme

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+orms o Pulic Relation$mployee Relations

Community Relation

Boernment RelationMedia Relation

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Con*ict'rganizational con*ict is a situation o closedor !in-lose competition9 in !hich parties try tokeep each other orm attaining their goals0

'pen situation #7in-7in% Approach

Close situation #Con*ict%

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5eels o con*ict)et!een 3ndiiduals9

)et!een indiiduals and group9

)et!een groups in the same organization

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4tages o Con*ict5atent Con*ict

3nitial stage

Causes are hidden et!een t!o parties

Perceied Con*ict

A!are o the cause

+elt Con*ict

Parties are emotionally inoled4tart eeling the con*ict

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4tages o Con*ictManiest Con*ict

2ostile ehaior

5ack o coordination

)reakdo!n !ork *o!

Con*ict Atermath

Con*ict solution4atisaction o oth parties

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Causes o inter group

con*ict:ne"ual or one side Dependence

3ncompatile perormance criteria andre!ords

Di6culty in apportioning credit or alance

Dependence on common recourses

3normation and rumors

Di.erences in personal ackgroundDi.erence in task9 time

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Management con*ictManagement o con*ict mean trying to /nd!ays to alance con*ict and corporation0

3mproe "uality o decisions

$ncourage Creatiity and 3nnoationProlem 4oling

4el ealuation and change

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Method o managing

con*ict4timulating con*ict

Reducing con*ict

Resoling con*ict

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Prere"uisites or successul

3ntegrationNegotiationRelation o trust

$arly attempt to resole di.erences

Clarity o rules

Physical pro8imity # T!o Parties%

Decentralized decision making and openness

'(ectiity

4upport rom management

<oint re!ard and Punishment

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+iscal Planning+iscal planning is a ery common strategy9regardless o their size it is ie!ed as themost appropriate and helpul !ays to success

a companies /nances and thus plan the estcourse o action to take or the uture0

Plan regarding Reenue and e8penditure

Clear picture or industrial /nance

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)udgetingA udget may e the simple plan o onespersonal /nances or it may e a comple8document used y large organization0 3t is the

picture o the total operational o all theorganization in monotony terms0

)udget is a alance estimated e8penditureand receipts or a gien period o time0

2eart o administratie management

Reduce the !astage o /nance

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+eatures o the udget4imple design and oriented to users

4hould e *e8ile

4ynthesis o past9 present the uture

Coordination

Composed t!o segment K Reenue and$8penditure

Re*ect the goals and appreciation

+or!ard planning

Need a support o top management

Time Period

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Purpose o udgetProide targets or income and e8penditure

To coordinate the actiities

To prepare cash *o! statement

+ormulating uture policy

To control on all actiities

A tool or communication and coordination

+inancial planning and decision making

Controllale and uncontrollale cost area

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3mportance o udgetPlanning uture course o action

Coordination in arious department

4eres as a guide or action

2elps 3n decision making

2elp in pro(ected o(ecties

Tool or communication

3dentiy prolems area

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Principles o udgetProide sound /nancial management

+ocus on o(ecties and polices

Most e.ectie use o /nance

Actiities planned in adance

Delegation o authority and responsiility ore8ecution o udget

Coordinating e.orts o arious departments4etting targets

Prepare under the superision and direction

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4teps in udgetingCollection o past data

Assess success and ailure o past

4etting o(ecties or orecast year

'(ecties arranged in terms o indication

Preparation o report on e8pense and reenue

Preparation o udget report

Reie! o udget report

$aluation or modi/cation or change

+inal preparation o udget

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$ssential re"uisition or

udget estimation+orecasting• Purchase decisions• $8pansion decision• Adertising

Accounting5ines o Authority)udget committee

• +orecast• Reporting• Deriation modi/cation

)usiness Policies4tatistical inormationPeriod o udget

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Types o udget3ncremental udget

• Change in percentage !ith the change o in*ation

+le8ile udget

Rolloer udget

• +orecast $8pense and reenue more then a year

• #uture planner%

'pen ended udget

• 4ingle cost estimation

• Actiity leel in the unit

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Types o udget+i8ed-ceiling udget

• +i8ed limit udget

Perormance udget

• )ased on unction

Programmed udget

• )ased on !hole programme

Production )udgetReenue and $8pense

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Types o udgetCapital e8penditure udget

,ero ased udget

• $ach cost or eery program

• $stimate oth cost 'ld and Ne!

4unset udget

• 4el destruct in prescried time0

•

'r 7hen task is completed4ales udget

Cash udget

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Capital and Reenue

$8penditure

Capital $8penditureK The e8penditure incurred orac"uiring a /8ed assets or !hich results inincreasing the earning capacity o the usiness iskno!n as Capital $8penditure0

Capital e8penditure means any e8penditureincurred to

F0Ac"uiring the assets

03mproing e6ciency

I0Purchasing the Perormance o the usiness• $80 Purchase o machinery

• +ees or installation o machinery

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Capital and Reenue

$8penditure

Reenue $8penditureK An e8penditure incurred inthe course o regular usiness transaction o aconcern are aailed during the same accountingyear is kno!n as reenue e8penditure0

Reenue e8penditure mean any e8penditure

incurred to maintain the assets in !orkingcondition and or the operation o the usiness0• $80 Repairs o urniture

• Painting o uilding

• Purchase o stationary

• 4alary

• Ta8es

• Rents;0

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Distinction et!een Capital

and Reenue $8penditureCapital Expenditure Revenue Expenditure

#Purpose% 3t is incurredor the purchase o /8ed

assets#$arning Capacity% 3t

increases the earningcapacity o the usiness

#Periodicity o ene/t% 3tsene/t are spread oer anumer o years

3t is incurred or themaintenance o /8ed

assets3t does not increase the

earning capacity o theusiness

3ts ene/t is only or oneaccounting year

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Distinction et!een Capital

and Reenue $8penditureCapital Expenditure Revenue Expenditure

#Placement in /nancialstatement% it is an item

o alance sheet and issho!n as an asset0

#'ccurrence oe8penditure% it is notrecurring in nature

3t is an item o treadingand pro/t and loss

account and is sho!n onthe deit side o either othe t!o0

3t is usually a recurringe8penditure

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,ero )udgeting,ero ased planning is done to shape decisionaout the marketing communication tools thatare to e used ased on the elements o the

particular years situation analysis9 47'Tanalysis and communication o(ecties ratherthen (ust planning in accordance !ith theudget o the preious year0

• Decision o Marketing tools• )ased on particular situation

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4tep in ,ero ased

planningDetermination o the key communicationprolem

Relate the marketing tools and /nalized

Comine oth the step and sole theprolems

De/ne other marketing communication areas

along !ith tools

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AuditDe/nition o audit is an ealuation o aperson9 organization9 system9 processenterprise9 pro(ect or product0

The audit term is commonly use in accountingut it also used in

• Pro(ect management

• uality management

• 7ater management

• $nergy conseration

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Audit

De/nition4ystematic process y !hich a competent9

independent person o(ectiely otains andealuates eidence regarding assertions

aout an economic entity or eent or thepurpose o orming an opinion aout andreporting on the degree to !hich the assertioncon/rms to an identi/ed set o standards0

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Characteristics o Audit>ital part o accounting

Baining inormation regarding +inancialstatement

3nclude non-/nancial area• 4aety

• 4ecurity

>eri/cation o cost accounts and recordchecking

>eri/cation o acts to ascertain

Accepted standard y goernment odies

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Classi/cation o Audit+inancial auditK

• +inancial statement

• 3normation integrity and reliaility

'perational AuditK

• +or internal control structure in a gienprocess or area

3ntegrated auditK• Comination o /nancial and operational audit

• Perorming or oerall o(ecties

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Classi/cation o AuditAdministratie auditK

• 3ssues related !ith operational productiity

• 3normation system audit

4pecialized AuditK

• 4erice perormed y third parties

+orensic AuditK

•

Discoering +rauds and crime• 3nestigation

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Beneral audit Procedure:nderstanding o the audit area4u(ect

Risk assessment and general audit plan

Detailed audit planning

Preliminary reie! o audit area4u(ect

$aluating audit area

Compliance testing

4ustantie testingReporting

+ollo! up

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The Typical Audit PhasesAudit 4u(ect• 3dentiy the area

Audit '(ecties• Purpose o the Audit• '(ecties

Audit 4cope• 3dentiy speci/c system• +unction or unit included in reie!

Pre Audit planning• 3dentiy technical skills and recourses• 4ources o inormation• +unctional *o! chart9 polices9standerds• 5ocation or acilities to e Audited

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The Typical Audit PhasesAudit procedure and steps or data gathering

• 4elect the audit approach

• 3dentiy list o indiiduals to interie!

• 'tain departmental polices9standerds

• Deelop Audit tools and methodology

• $aluating Test

•

Process or communication• Audit Report

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Audit Risk3nherent Risk• $rror $8ists in Material9 Comine !ith other errors

• $rrors done y mistake

• Comple8 calculation

Control Risk

Detection Risk

• Material errors do not e8ist !hen9 in act9 they do

• Detections done y aility o auditors

'erall risk

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Nursing AuditAudit in nursing management is theproessional ealuation o the "uality o thepatient care9 y analyzing through all the

acilities9 4erices9 measures inoled indiagnosis9 treatment and other conditions andactiities that a.ect the patients0

• $aluation

• 4erice9 +acilities9 Treatment• Patients

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Nursing AuditNursing audit reerence to the assessment othe "uality o clinical nursing

- $llison

Nursing audit is the means y !hich nursesthemseles can de/nes standards rom theirpoint o ie! and descrie that actual practiceo nursing0

- Boster!aler

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Characteristics3mproe the "uality o nursing

Compare Actual practice and standardpractice

+ormal and systematic

>ariation9 Deiation

+eed ack or those !hose records are

audited$aluation

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'(ecties$aluate the "uality o nursing care

To achiee the desired and easile "uality ocare

To proide !ay or etter records

+ocus on care proided and care proider

To proide rationalized care therey

maintaining inorm standards !orld!ide0 To contriute to research

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Methods o Audit in

NursingRetrospectie ie!

• Detail "uality care assessment ater thepatients has een discharged

• Reie!ed ater diagnosis9Treatment9lainestigation9 consultation

Concurrent ie!

• Reie!ing the patients care during the time o

hospital

• Assessing the patient at the ed-side in relationto predetermined criteria

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Audit CycleCriteria deelopment

4election o case

7orksheet preparation

Case ealuation

Taulation o ealuation

Presentation o report

d i

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Adantages Nursing

AuditPatient is assured o good serice

)etter planning o "uality improement can edone

3t deelops openness to change3t proide assurance9 y meeting eidence

ased practice

3t increase understanding o client=s e8pectation

3t minimize error or harm to patients

3t reduce complains or claims

i d i

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Disadantages o Nursing

Audit3t may e considered as a punishment toproessional group0

Medico-legal importance They eel that !ill e

used in court o la! as any document can ecalled or in court la!0

Many component may make analysis di6cult0

3t is time consuming

3t re"uire a team o trained auditors0

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Cost AccountingCost accounting has long used to helpmanagers understand the costs o runningusiness0

• Comple8ities o running large scale usinessled to the deelopment o the systems orrecording and tracking costs to help usinesso!ners and manage make decisions0

•

Cost accounting inoles the classi/cation9recording9 and appropriate allocation oe8penditure or the determination o the cost oproduction or serices0

'( i C

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'(ectie o Cost

accounting To determine cost o product

To analyze classiy and record all e8penditure !ith respectto the cost

To proide necessary inormation to the management intime

To sere as a guide y proiding actual data orcomparison

To acilitate price /8ation

To assist udget control To assist cost control and cost reduction

To proide data or di.erent periods and olumes o output

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Classi/cation o CostsClassi/cation on the asis o time

F02istorical cost0Predetermined costClassi/cation y nature o element

F0Material cost• Direct Materials• 3ndirect Materials

05aor Cost• Direct laor• 3ndirect laor

I0$8pense cost• Direct $8pense• 3ndirect $8pense

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Classi/cation o Costs'erheads

F0Production or +actory oerheads0Administration oerheads

I04elling oerheads

H0Distriution oerheadsAccounting Period-!ise classi/cationF0Capital e8penditure0Reenue e8penditure)ehaior !ise classi/cation

F0>ariale cost0+i8ed costI04emi ariales

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Classi/cation o Costs)ased on Control

F0Controllale

0:ncontrollale

'ther costs

F0Normal costs

0 Traceale cost

I0 Total cost

A h C t

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Approaches o Cost

Accounting4tandard CostingK

A techni"ue !hich uses standers or coast andreenue or he purpose o control through

ariance -C3MA• 3t is a system o cost accounting

• Determine in adance the standard cost !ithrespect to each element o cost

•

Compare the actual perormance• Analyze the ariance9 attriutes and causes

• Communicates or report to the appropriateleel o management

A h C t

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Approaches o Cost

Accounting 5ean AccountingK

5ean accounting has deeloped in recent years toproide the accounting9 control and measurementmethods supporting lean manuacturing and other

application0• Proide control & Measurement• :sed in9F0 2ealth care0 Construction

I0 3nsuranceH0 )ankingQ0 $ducationJ0 Boernment

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4tep To 5ean AccountingMeasure and control company=s account• Reduce the !astage

• +ree up capacity

•

4peed up the process• $liminate errors & Deects

• Make process clear & under stale

+undamentally change the account• )y motiate change

• 3mproement

• Proide suitale inormation

• Decision making

Ch t i ti 5

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Characteristics o 5ean

Accounting5ean ocused perormance measurement

Direct costing & >alue stream

Decision making & Reporting

>alue ased Pricing

Correct understanding o /nancial impacts

A h C t

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Approaches o Cost

AccountingMarginal CostingK

The amount as any gien olume o out puty !hich aggregate costs are changed i the

olume o output is increased or decreased yone unit0

• >ariale cost as product cost

• +i8ed cost as a period cost

• Price ased on marginal cost

A h C t

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Approaches o Cost

AccountingActiity ased costing #A)C costing%K

Actiity ased costing is a system that ocuson actiities as undamental cost o(ects and

utilize cost o these actiities as uildinglocks or compiling the cost o other o(ects0

• Costing )ased on Actiity

• Accordance !ith cost o(ect

• :se o cost driers

• Traceaility

A h C t

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Approaches o Cost

Accounting Throughput AccountingK TA is a dynamic9 integrated9 principle ased9 andcomprehensie management accounting approachthat proide managers !ith decision support

inormation0AdantagesKF0Accumulate data to assess the cost03dentiy the interaction et!een e8penditureDisadantagesKF0Di6cult to associate the di.erent costs or

particular program0Di6cult or manager to (ustiy the cost o nursing

care program

C t . ti

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Cost-e.ectieness

analysisCost-e.ectieness analysis is a orm oeconomic analysis that compares the relatiecosts and outcomes#e.ects% o t!o or more

courses o action0• Cost ene/t Analysis

• Cost e.ectieness

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CPM Critical Path Method3n FGQ9 DuPont deeloped a pro(ectmanagement method designed to address thechallenge o shutting do!n chemical plants or

maintenance and then restarting the plantsonce the maintenance had een completed0Bien the comple8ity o the process9 theydeeloped the Critical Path Method or

managing such pro(ects0CPM models the actiity and eents o a

pro(ect as a net!ork0

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Characteristics o CPMProides a graphical ie! o the pro(ect

Predict the time re"uired to complete thepro(ect

4ho!s !hich actiities are critical to maintainthe schedule and !hich are not0

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4teps in CPM4peciy the indiidual actiitiesK )unch o actiities 4eparate all the actiates

Make se"uenceDetermine the se"uence o the actiities Actiities are interdependent Make net!ork diagram or se"uence o Actiities

Dra! the net!ork Diagram 'nce the actiities and their se"uence hae

een de/ned the CPM diagram can e dra!n0

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4teps in CPM$stimate Actiity Completion Time The time re"uired to complete each actiity can

e estimated using past e8perience or theestimate o the kno!ledgeale persons0

3dentiy the critical Path Critical path is the longest duration path

through the net!ork0 '(ect is not to delay in the pro(ect Critical path analysis is an important aspect o

pro(ect planning0

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Parameters or CPM$arliest start time

$arliest /nish time

5atest /nish time

5atest start time

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)ene/ts o CPM4upport the introduction o eidence-ased

medicine and use o clinical guidelines

4upport clinical e.ectieness9 risk

management and clinical audit3mproe multidisciplinary communication9

team!ork and care planning

Can support continuity and coordination o care

across di.erent clinical disciplines and sectorsProide e8plicate and !ell-de/ned standards

or care

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)ene/ts o CPM2elp reduce ariations in patient care

2elp improe clinical outcomes

4upport training

'ptimize the management recourses

2elp empo!er patients

2elp manage clinical risk help improe

communications et!een di.erent caresectors

Proide a aseline

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5imitations o CPM+uture is uncertain so completion time i

pro(ect is uncertain0

An alternatie to CPM is P$RT pro(ect

planning model9 !hich allo!s a range oduration to e speci/ed or each actiity0

Documents

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